Fashion world more ready now for metaverse IP issues, says expert

19 May 2022

Fashion world more ready now for metaverse IP issues, says expert

Prof. Dr. Irene Calboli, professor of law at Texas A&M University School of Law in Fort Worth believes the fashion industry is more ready now to face intellectual property issues arising from the metaverse than it was in pre-pandemic times.

“I would say fashion industry is certainly readier than it was at the beginning of the pandemic. It needs to be even readier for the future,” said Calboli, “but the level of readiness has increased tremendously and exponentially across all segments – the luxury segment, the mid- segment and the economy and fast fashion segment – without question.”

According to Calboli, who is also a visiting professor at the Nanyang Business School, Nanyang Technological University in Singapore, companies including luxury brands are now using the metaverse for advertising and selling. In fact, she said the metaverse became useful during the Covid-19 lockdowns and the slowdown of activities that came with the pandemic.

The term “metaverse” sprang up in public consciousness following Facebook Inc.’s rebranding and renaming to Meta. According to CEO Mark Zuckerberg, the new name reflects the company’s activities. Such activities now include the development of a platform that will allow people to connect in the metaverse, a virtual reality world where people can work, play, shop, interact and do other things by using virtual reality headsets.

“The metaverse is an alternative reality in which brands could have a presence, whether through video games or a variety of virtual media that allow them to stay relevant during a time in which brand acquisition and consumption of products, the physical goods, was more difficult,” said Calboli. “And in some way, Covid-19 has accelerated the importance of the metaverse.”

Lawyers and attorneys claim there are several IP-related issues in connection with the metaverse, some components of which are now taking place with the existence of Fortnite, Minecraft, Roblox and others.

Among these are trademark issues emerging from the fashion world. Already, trademark infringement cases from the fashion community are piling up in courts. One of these is Hermès International v. Mason Rothschild now pending in the United States District Court for the Southern District of New York. Rothschild, an artist from California, infringed the luxury brand’s rights over its BIRKIN trademark and trade dress by selling 100 non-fungible token (NFT) images carrying the bag’s famous design and embellished with fur. Dubbed as “MetaBirkins,” said NFTs are being sold in the metaverse.

Calboli, whose expertise includes IP and fashion laws, explained: “There are some specific challenges that come to all trademarks. What goods and services are brands selling in the metaverse? What part of protection do they have or should they seek and for what products? And so here is where there is the brand extension of luxury bags, luxury watches, luxury jewelry, or luxury clothing that could be adopted through the metaverse. So these are the same goods, but on the metaverse, they’re virtual replicas of existing goods. In terms of registering trademarks, this question becomes relevant. Should I have another registration, another protection particularly if the products are not famous or well-known in the trademark jargon?”

Another potential IP-related problem revolves around the metaverse’s ability to multiply content very quickly, either ephemerally or to a limitless number of copies.

“Say we have a digital exposition that is projected on a specific venue in Milan but that could be easily transported in the Internet space and then distributed. And so the question is ‘Is the protection harmonized territorially for all the various countries?’” she said.

To begin preparing for the metaverse and its accompanying IP issues, Calboli said that fashion brands should do the following:

  • Understand the goods and services in the metaverse.
  • Understand what their business strategy is
  • Understand what their business model is and how the metaverse and the digital world in general is changing or enhancing it
  • Hire IT geeks, not just fashion geeks

“Marketing should also understand how to use technology, AI, apps and so on. These involve a lot of IP and data protection issues which bring in territoriality matters,” she claimed.

  • Understand blockchain which is a crucial component for NFTs and others in the Internet space
  • Know how they want to use the metaverse and to what extent they want to use it.

Afterwards, it’s about registering the trademarks for the digital goods and services they want to use in the metaverse and using these trademarks as well.

She mentioned concerns from some sectors, such as those about NFTs being a bubble.

“A lot of these concerns are true,” said Calboli. “But the metaverse is here and it’s here to stay. And so after some of the noise that we now hear, because it’s something new, will be gone, we’ll continue to see the use of the metaverse in terms of marketing, experiences and consumption of goods.”


Espie Angelica A. de Leon

Law firms

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